Question

Wage and Tax Statement Data on Employer FICA Tax Ehrlich Co. began business on January 2. Salaries were paid to employees on the last day of each month, and social security tax, Medicare tax, and federal income tax were withheld in the required amounts. An employee who is hired in the middle of the month receives half the monthly salary for that month. All required payroll tax reports were filed, and the correct amount of payroll taxes was remitted by the company for the calendar year. Early in the following year, before the Wage and Tax Statements (Form W-2) could be prepared for distribution to employees and for filing with the Social Security Administration, the employees' earnings records were inadvertently destroyed. None of the employees resigned or were discharged during the year, and there were no changes in salary rates. The social security tax was withheld at the rate of 6.0% and Medicare tax at the rate of 1.5% on salary. Data on dates of employment, salary rates, and employees' income taxes withheld, which are summarized as follows, were obtained from personnel records and payroll records: Employee Date First Employed Monthly Salary Monthly Income Tax Withheld Arnett Nov. 16 $3,900 $577 Cruz Jan. 2 5,100 959 Edwards Oct. 1 2,400 298 Harvin Dec. 1 2,100 260 Nicks Feb. 1 10,400 2,340 Shiancoe Mar. 1 3,200 490 Ward Nov. 16 8,100 1,750 Required: 1. Calculate the amounts to be reported on each employee's Wage and Tax Statement (Form W-2). Enter amounts to the nearest cent if required. Enter all amounts as positive numbers. Employee Gross Earnings Federal Income Tax Withheld Social Security Tax Withheld Medicare Tax Withheld Arnett $ 5,850 $ $ 351 $ 87.75 Cruz 61,200 3,672 918 Edwards 7,200 432 108 Harvin 2,100 260 126 31.50 Nicks 114,400 6,864 1,716 Shiancoe 32,000 1,920 480 Ward 12,150 729 182.25 $ 14,094 $ 3,523.50 2. Calculate the following employer payroll taxes for the year: (a) social security; (b) Medicare; (c) state unemployment compensation at 5.4% on the first $10,000 of each employee's earnings; (d) federal unemployment compensation at 0.8% on the first $10,000 of each employee's earnings; (e) total. Round your answers to two decimal places. (a) $ (b) $ 0 (c) $ 0 (d) $ 0 (e) $ 0 Feedback Consider each employee's date of hire. Remember there is a limit on how much the employer pays for state and federal unemployment taxes per employee.

Answer 1